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Regulation of orphan drugs within the EU

Simply put, an orphan drug is indicated for the treatment of a very rare disease. Such diseases are often due to genetic defects and therefore children and newborns are affected to a great extent1.

The problem with such rare diseases is that – under normal conditions – it does not pay for pharmaceutical companies to put any effort into research and development of drugs to treat them. Incentives are needed and, to call a spade a spade, they should be monetary.

While such incentives for the development of orphan medicinal products have been available in the USA since 1983 and in Japan since 1993,2 it took the European Union until 1999 to develop a harmonised regulation on the issue. The result was Regulation (EC) No 141/20003 (Orphan Drug Regulation, ‘ODR’) which has – nowadays, rather surprisingly – only undergone one amendment in 2009. Considering the regulation has been in force for more than 15 years already without any major changes,4 it seems that the European legislator has succeeded in passing a profound and mature law that is worth taking a closer look at.

Within the regulation, the European legislator has developed a whole catalogue of incentives with great monetary value. These will be set out in this article, as well as the question of what an orphan drug is, how such a designation is granted, and what kind of products are eligible for orphan drug designation.

Orphan drug definition

As already pointed out, orphan drugs deal with rare conditions. This aspect, however, is just one among several that need to be fulfilled.

First of all, a product can gain orphan drug status if it is intended for the diagnosis, prevention or treatment of a life-threatening or chronically debilitating condition affecting not more than five in 10,000 people in the European Community (EC) when the application is made.5 This is how the aspect of ‘rare disease’ is reflected in the legislation. The prevalence is determined by figuring out how many people the product will be administered to.1

Fortunately for some companies, this quite narrowly fixed prevalence is not an inevitable requirement. Rather, if a disease is more common than that, a product may nevertheless obtain the desired exclusive status if it is intended for the diagnosis, prevention or treatment of a life-threatening, seriously debilitating or serious and chronic condition in the EC, and that without incentives it is unlikely that marketing the medicine in the EC would generate sufficient return to justify the necessary investment.6

In case neither the prevalence-based or economic-based requirement are fulfilled, there is another important aspect. This is that no satisfactory method of diagnosis, prevention or treatment of the condition has been authorised in the EC or, if such a method exists, that the medicinal product will be of significant benefit to those affected by the condition.7 Thus, the European legislator requires a certain kind of patient improvement and advantage compared to products already available.

But what exactly are the advantages of obtaining that status of an orphan drug? And why is it so attractive for companies to apply for such a designation?

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